Thankfully he realized the problem with DRM; it only has to be cracked once, and then it’s pointless and only serves to bug legitimate users, so he’s dropping it. He also lowered some prices of his games to boot, so, win for consumers! (And hopefully this will help his longterm sales, and not just the short term because of the notoriety gained.)

But there’s an even bigger picture to look at, so let’s do that. Allow me to become a bit of a futurist here and share with you how I could see things happening…

Pirates win, content owners fail.
First, pirates win while content developers lose. That’s not hard to figure out, really. In fact, it’s starting right now as piracy becomes more and more rampant*. Content developers are realizing they can’t sue everyone and are creating better websites like Hulu to keep people from downloading and keeping them from making any money. To be frank, I firmly believe that eventually people will take the attitude that “bits should be copied freely,” and industries will soon scramble to find new ways to ensure they stay on top. They’ll fail. I expect them to go to commercial-driven content, but that’ll just piss people off when they can stream it for free from illegal sites* that will probably be far more user-friendly anyway, and media companies will be relegated to sideshow status at best.

Amateurs win, while professionals flounder.
Much like we’re seeing the beginnings of now, as Big Media struggles to find its place, actual artists (who are savvy) will thrive like never before. Musicians will spread their music freely, and sell out concerts with ease. They’ll sell audio recordings of the concert you just witnessed for cheap, and the bigger bands will even be able to sell you videos of the concert as you leave the venue. If you read this, you probably already know names like “Penny Arcade,” and “Jonathan Coulton,” but note that even Trent Reznor is giving away his music now. If Big Media can’t make this method work for them, expect to see ‘amateurs’ operate at the same level, if not bigger than ‘traditional’ artists.

New professionals win, consumers win.
Those artists, the indie ones? If ‘success’ is as easy as ‘making a living at your art,’ then let’s hope it becomes the norm. (Cross your fingers.) And here we come to the root of exactly how future media could work. Everyone will get the digital files for free. Any person can download and publish any movie, song, art, game, etc. at any time. (A definite win for consumers in my book.) Sure, donations are great, but musicians/performers/actors can charge for life performances (yes, I’m predicting a resurgence of live theatre,) and traditional artists could sell their canvases/sculptures/works. In fact, anyone can sell physical products, just look at the approach of some of theseartists. But, what would be the meat and potatoes of games?

Games.
If games follow suit, then what will games offer that will keep them viable in the eye of gamers? What is the true essence of ‘art’ in games that makes it a notable difference from all other arts? Interaction. Gamers will be charged subscriptions to play in a world of premier dungeon masters. With all games made of open source, bare bones tech, Game Runners will create an experience that will build up their reputations amongst gamers as good, bad, dense, or grandiose. Just like musicians and directors have their own styles, so will Game Runners.

Yeah, this is the only way to get rid of pirates… Leave nothing for them to pirate.

*More people are born with piracy being the norm, bandwidth rises, latency falls, and advanced processing allows for greater compression. Given these things, in our lifetimes I expect we’ll see very high quality games streamed with relatively little caching (and of course high quality video/audio streamed with no problem.)

But when we get holodecks (or VR)? The big piracy items will be worlds and files of actors, so that people can put any actor into any role in their own personal realities/fantasies. Shit will get twisted, sir.